16 December 2019
We’re building PMI’s future on smoke-free products that are a much better choice than cigarette smoking. Indeed, our vision – for all of us at PMI – is that these products will one day replace cigarettes.
But changing the product is not enough, the transformation of our company doesn’t stop there. We are also changing completely our value chain and the way we operate. While continuing to manage our cigarette business responsibly to generate the resources to finance our transformation, we are shifting significant resources towards building new capabilities.
In order to make our transformation both measurable and verifiable, we developed a set of bespoke business transformation metrics on which we report on periodically to show progress. Beyond changing the product and transforming our value chain, the way we interact with society is key. For that, we need to be aware of the impacts our current and future business create, from a social and environmental standpoint. Our approach to sustainability plays a key part to addressing non-financial issues and defining the way in which we relate and work with external stakeholders.
At PMI, we believe that a concept of performance that excludes corporations’ environmental, social, or product impact creates poor outcomes. We need to redefine what success means to align business, environment and society. Our financial system needs to redefine performance to include environmental and societal considerations such as producing products that truly benefit customers. Doing so requires measuring the impact companies are having on society, translating social and environmental costs and benefits into comparable units and reflecting it in financial accounting, reporting and disclosures that investors can understand and we hope that being members of, and continuing to work with, VBA will allow us to together achieve that purpose.
Interested readers may refer to Michael P. Krzus’s publication on PMI’s purpose statement in the Responsible Investor (link).
Vice President and Controller
Philip Morris International